On January 17, 2017, the U.S. Department of Homeland Security (DHS) published the final rule for providing parole to international entrepreneurs who are starting their own businesses in the U.S. Recall that I had published my commentary on the proposed version of the same rule, here. Of course, as someone who follows and practices immigration options for international entrepreneurs, I was excited for that rule. Then, DHS added more discretionary factors to the EB-2 self-petitions with National Interest Waiver (NIW), which would be difficult to obtain for someone who wants to start their own business soon after graduating with an undergraduate degree. Subsequently, DHS published the NEW Parole for International Entrepreneurs Rule, effective July 17, 2017.
Of course, "parole" is a temporary status, but how about using this parole to gain experience through your business, possibly gain public recognition, work for a few years (five years to be exact, which is the amount of years in your profession needed to qualify for EB-2, Advanced Degree), and eventually petition for EB-2 with NIW? Just a thought.
These legal changes in the international entrepreneurs sector are all new and immigration law practitioners, such as myself, are excited to push the envelop a little bit, see how far DHS is willing to go. I am glad that DHS at least listened to many of our comments and made the final version of this rule, published as 8 C.F.R. 212.19, much easier for international entrepreneurs to comply with.
What's Different and How Friendly to Entrepreneurs?
ONE: You may now pursue the application for parole if you had started your business within 5 years prior to the parole application date. In the proposed version, DHS only gave 3 years. Now, more time to set up your business, more able to prove funding and viability of your business.
TWO: Under the final rule, applicant must own at least 10% of the company. Under the proposed rule, you must have owned 15% of the company to apply. Now, less equity in the company is required, which means less illiquid assets will be tied up in the company, more freedom for your money.
THREE: The monetary amount of investment required from private investors has been lowered to $250,000. Under the proposed rule, the required amount was $345,000. With the final rule, DHS has lowered the amount by almost $100,000! That is a lot of money for a new entrepreneur looking for private funding. However, the government grant requirement still stands at $100,000. Most importantly though, the discretionary "alternative criteria," that the applicant's business will provide significant public benefit to the country, still stands. Public benefit could be proven through the entity's "substantial potential for rapid growth and job creation," which is of course, speculative evidence and the value that I am looking forward to add to my clients' cases.
FOUR: Initial term is 2.5 years, with re-parole of 2.5 years possible. Under the proposed rule, the initial term was 2 years, with re-parole of 3 years. Six months is not a huge difference in the grand scheme of life, but it could mean a huge difference for a small business owner, who may just need six months more for his business to begin showing growth.
IMPORTANT NOTE! I don't know if it is a coincidence that the maximum number of years allowed for parole is the same as the number of years needed to qualify for the EB-2 self-petition of someone possessing an advanced degree. However, it is exciting that it works out this way. Hopefully, about 5 years from now, my international entrepreneur clients who obtained temporary parole will be able to use EB-2 to obtain their legal permanent residence.
FIVE: An applicant for re-parole only has to possess 5% ownership interest in the entity. The proposed rule required 15% ownership interest. Now, after you obtain initial parole, you may free up your money and invest somewhere else!
If you enjoyed this information and believe that it would be beneficial to you, your friends, or your family, I am holding a seminar in Cambridge, Massachusetts on March 4 at 10am, to provide more information for international entrepreneurs. The event is free, but seating is limited, reserve your ticket here.